The Commonwealth Utilities Corp. is expected to include the over $30 million in fines owed to the U.S. Environmental Protection Agency in this year’s audit.
The EPA fines were not accrued in last year’s audit or even included in footnotes.
As of September 2014, CUC owes about $33 million fines for violating “Stipulated Order No. 1.” Most of these fines are for unfilled management positions.
The EPA, though, is not expected to collect on these fines. Last year, $40 million were waived from Stipulated Order No. 2.
Because CUC does not expect the current fines to be waived, they would need to accrue it as an expense and have an accrued liability just like their debts for the Commonwealth Development Authority and Commonwealth Ports Authority.
But because EPA is not likely going to collect, they are expected to at least include the fines in their audit’s footnotes.
EPA sets a $1,000 per day per violation for the first 30 days CUC violates “Stipulated Order No. 1” requirements for management structure. EPA sets a $2,000 per day per violation for the following 30 days. EPA sets $5,000 per day per violation for each day thereafter.
CUC’s deputy director position has been vacant since July 15, 2013, when director Alan Fletcher was promoted to executive director. The division manager for drinking water and wastewater position has been vacant since September 2014, and the technical manager for oil has been vacant since January 2015.
All these positions were or are required to be filled within 150 days.